Why the Payright (ASX:PYR) share price is storming higher today

Payright Ltd (ASX: PYR) shares are on the rise today following the release of the company's latest trading update.

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Payright Ltd (ASX: PYR) shares are on the rise today after the company released its trading update for the final quarter of 2020 calendar year.

In morning trade, the Payright share price is up 5.8% to 90 cents.

What driving the Payright share price higher

For the period ending December 31, Payright revealed strong quarter-on-quarter growth in gross merchandise value (GMV) and customer numbers across the Australia and New Zealand region.

Total group GMV came to $20.6 million for the quarter, up 28% on the prior corresponding period.

The buy now, pay later (BNPL) provider attributed its solid performance to a direct strategy of offering higher-value purchases to its customers.

In addition, the business expanded its customer base to 42,300, which represented a lift of 13% on the September quarter. This was underpinned by Payright's approach in adding new merchants to its growing portfolio, which in turn harnessed new customers.

The company signed 256 agreements in the December period complementing its 2,800-merchant partnerships. Payright is currently tapped into the retail, home improvement, health and beauty, photography, education and automotive sectors.

The company further noted that it is uniquely positioned throughout Australia and New Zealand as a high-value 'considered' purchases provider. Offering between $1,000 to $20,000, Payright highlighted its product differentiation to existing players in the BNPL market. Higher-value purchases allow customers to pay for more expensive products and services that are not available from other BNPL providers.

Management commentary

Payright Co-CEO  Piers Redward, welcomed the results, saying:

In addition to the strong momentum across our target markets, the progress we are making in New Zealand is clear evidence of the significant opportunity for Payright to assist businesses which are seeking a consistent solution across both geographies. We believe this will help to further strengthen our position in Australia, particularly in relation to merchants which operate across both countries.

Payright Co-CEO Myles Redward added:

The growth we are seeing is a direct outcome of the strategy we are pursuing. This includes complementary customer and merchant acquisition strategies to keep growing our penetration rates across both geographies and across our key industry sectors, as well as the enhancement of integrated technology solutions spanning ecommerce, marketplaces and point of sale software designed to accelerate our growth agenda.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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